Form 15CA and 15CB for Remittance of Money to NRIs

Many Non-Resident Indians have money in India that they want to send abroad to their overseas bank accounts. During outward Remittance or Repatriation, banks are required to ensure whether the tax was paid or not. There are certain types of foreign remittance where submission of Form 15CA or 15CB is required under the Indian Income Tax Act. Here is the guidelines on Form 15CA and 15CB for remittance of money to non-residents.

Form 15CA and 15CB
Outward Remittance: How can NRIs send money abroad from India?

Repatriation and Outward Remittance

The process of sending money from India to the overseas bank accounts of the NRI is called Repatriation. The medium or channel through which the money is sent overseas is called Outward Remittance. It can be done online, through demand drafts or cheques.

Now, we know that NRIs can’t hold Resident India Savings Bank Accounts. They will have the following bank accounts in India:

Forms 15CA and 15CB for Outward Remittance

Outward remittance has tax implications. At the time of any payment or remittance of money to a non-resident, the bank needs to ensure whether the applicable tax was paid or not. If not, the bank will check if it is certified by any competent authority like the chartered account or the assessing officer. However, there are many types of foreign remittance where you don’t need to submit a Form 15 CA or Form 15 CB. 

What is Form 15CA

Form 15CA is a declaration made by remitter stating that he has paid tax on money being remitted to the non-resident. The information is utilized by the Income Tax Department to track the foreign remittance and to determine tax liability. 

What is Form 15CB

Form 15CB is a certificate issued by a chartered accountant regarding the rates and right kind of tax paid by you in compliance with the Double Taxation Avoidance Agreement and the Income Tax Act. Certain details from 15CB are required at the time of filing Form 15CA. Form 15 CB includes the following details:

  • Information regarding the payment made to a Non-Resident. 
  • Compliance with Section 195 of the Income Tax Act.
  • Rate of TDS deducted. 
  • Validity of Double Tax Avoidance Agreement.  

Applicability of Form 15CA and 15 CB

  • None form is required if the amount being remitted is not subject to taxation.
  • If the remittance is eligible for a specified exemption, then only Part D of the Form 15CA needs to be submitted. 
  • If the total amount remitted in a particular financial year is less than Rs. 5 lakh, only Form 15CA – Part A needs to be submitted. 
  • If the remittance is more than Rs. 5 lakh, Form 15CA – Part C and Form 15CB are to be submitted.
  • You will have to submit Form 15CA – Part B, if the remittance exceeds Rs. 5 lakh and a certificate under Section 195(2)/ 195 (3)/ 197 of the Income Tax has been obtained. 

Amongst these, both NRE and FCNR accounts are used to park the money earned abroad by an NRI with tax-free interest up to 7.25%* on NRE FDs. The money in these accounts can be easily repatriated using the internet banking facility. Therefore, in this article we will focus more on the NRO Account.

Outward Remittance for NRI: Sending money abroad from India

The NRO Account

The NRO account is opened for the purpose of maintaining the income earned from India such as income from rent, pension, gains from investments, etc. The repatriation of the money in the account can be done up to a maximum of 1 million USD per financial year.

Note: 30% tax + surcharge + education cess will be deducted at the source of interest earned in India.

Repatriation Highlight: up to a maximum of 1 million USD per financial year.

Now, since NRO is the only account where you maintain your Indian income and it is taxable too. The process of repatriation is different from the other two accounts (NRE & FCNR). Choosing the outward remittance facility under the NRO Account involves a limit (1 million USD per year) and taking care of your taxes. Let’s glance through the documentation requirements and the outward remittance process:

Account ProcessLimit
NROAll the following documents are needed to be submitted at the Bank Branch (in India). You can either submit it when you arrive here or download it online and send the signed copies to bank branch via courier:

1) Form 15CA (The purpose of this document is to ensure that taxes are collected on the funds before they are remitted abroad as it becomes difficult to recover taxes at a later stage) 

2) Form 15CB (Certificate of an Accountant) (The Accountant fills the form and shares it with the account holder. The account holder then sends it to the bank via courier) 

3) Form A2 (Form for remittance)

4) Request Form from the Bank (for details to debit funds from your account)
USD 1 million

Note: Click on forms 15CA and 15CB to download.

Key points to keep in mind while opting for outward remittance through NRO Account:

  • Form 15CB is not required for remittances below Rs.50,000 (single transaction) and Rs. 2,50,000 (annually)
  • The exchange rates prevailing at the time of repatriation will be applicable
  • It can take up to 2 days for the transfer to get completed
NRI Bank Accounts Overview

Double Tax Avoidance Agreement (DTAA)

The interest earned on the money deposited in the NRO Account is liable to taxes. The basic concept behind this is simple: the money deposited in the NRO Account is generated in India, therefore it is taxable in India.

Now, this interest earned on the NRO Account is taxed at 30% along with surcharge and education cess which can be later filed for a refund based on your income tax slab in India.

However, there is an aspect of double taxation that needs to be addressed. The money can be taxable in the country of residence of the NRI and to avoid paying double taxes, there is an instrument called DTAA (Double Tax Avoidance Agreement).

There are various documents required to avail the benefits under DTAA (Double Tax Avoidance Agreement), which are:

  • Self-declaration cum indemnity format 
  • Self-attested PAN card copy 
  • Self-attested visa and passport copy 
  • PIO proof copy (if applicable) 
  • Tax Residency Certificate (TRC) 

Note: According to the Finance Act 2013, an individual will not be entitled to claim any benefit of relief under the Double Taxation Avoidance Agreement unless he or she provides a Tax Residency Certificate to the deductor. To receive a Tax Residency Certificate, an application has to be made in Form 10FA (Application for Certificate of residence for the purposes of an agreement under sections 90 and 90A of the Income-tax Act, 1961) to the income tax authorities. Once the application is successfully processed, the certificate will be issued in Form 10FB.

If you have any queries regarding the process of repatriation through outward remittance from India to abroad and the tax angle associated with it, ask our tax expert now using the button below. Also, visit our blog and youtube channel for more details.

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Outward Remittance: FAQs

Can I keep an NRI account after returning from overseas?

No. You cannot keep your NRI Accounts (NRE, NRO, FCNR) after returning to India. However, you can continue your NRE and FCNR Deposits till maturity and later convert them into RFC Accounts.

What is the limit for doing outward remittances from an NRE account?

There is no limit for outward remittance from an NRE Account.

Can NRI transfer money to savings account in India?

Yes. An NRI can transfer money to savings accounts of family and friends in India.

Do I need to file Form 15CB before the filing of Form 15CA?

Yes, it is compulsory to file the details in Part-C of Form 15CA because the Acknowledgement Number of e-verified Form 15CB should be verified. 

What are the documents required for filing of the Form 15CA?

Information required to file the Form 15CA includes tax residency certificate (TRC), invoice, and the agreement entered into between the parties and Form No. 10F.

What are the consequences of not complying with the Form 15CA and Form 15CB?

A penalty of Rs. 1 lakh can be imposed in case of the non-compliance with the Form 15CA and Form 15CB. 

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